1. Car insurance coverage in Toronto is mandatory
How mandatory is car insurance? Fines for driving without car insurance range from $5,000 to $50,000 and could be accompanied with a licence suspension.
The minimum requirement for car insurance in Toronto (and all of Ontario) is “basic” car insurance. This includes:
• Third-Party Liability to cover costs for anyone not involved in an accident you caused but is nonetheless affected; like if you were to knock over someone’s fence with your car.
• Statutory Accident Benefits to cover any living costs, medical expenses, rehab expenses, attendant care, lost income, lost education and/or funeral expenses you incur as a result of an accident.
• Direct Compensation to cover property automotive damage to your car, and keep you from having to wait for the other participant’s insurance company to get their Ps and Qs in order.
• Uninsured Automobile to cover costs if you happen to be in an accident with someone who doesn’t have car insurance.
How much is car insurance in Toronto
As mentioned above, basic car insurance in Toronto will run you ~$2,000 a year (or ~$170 a month). This can go up or down depending on your age, gender, specific location in the City, car model, yearly mileage, driving record and past claims; or if you share your car with anyone else.
2. Premium car insurance coverage is available in Toronto
No one would fault you for wanting extra protection out on the roads, especially given how much more likely you are to get into an accident now that Ontario is licensing 300,000 drivers every year.
These premium options include the following coverage:
This is similar to your basic policy’s Direct Compensation Coverage, but the difference is important.
Basic car insurance will give you the money to fix your car for the percentage of the damage that was deemed not your fault. But it won’t cover the percentage of damage you’re considered ‘at-fault” for.
So, if you’re responsible for 25% of the accident, your basic coverage will cover 75% of the damages. Collision Insurance will cover the rest.
Collision insurance averages $500 to $700, but can be more expensive if you own a high-end vehicle. You can always lower your collision insurance premiums by agreeing to pay a higher deductible.
Comprehensive car insurance
This covers damage not caused by a collision, like if a tree limb falls on your roof, or your car is stolen, or your car is trampled by elephants escaped from the zoo (it could happen).
Unlike the Collision/Direct Compensation relationship, fault is a non-issue here. So, if you decide to park your car at the business end of an archery range and find a couple of bullseyes in your grill, comprehensive insurance will still apply.
Comprehensive car insurance costs around $100 to $300 per year on average (usually cheaper than a collision policy).
Extra third party coverage
As noted above, third-party coverage is a standard part of all basic car insurance in Toronto. But the minimum requirement is $200,000. After an accident involving a third party, if you’re on the hook for more than that, you’ll need to personally pay the difference. And that difference could be massive if you need a legal defence.
This is where that extra third-party coverage is so helpful. In a city like Toronto with over 6 million people, where the likelihood of a third-party being involved is so much greater (be it a car with multiple passengers, adjacent vehicles and by-standers), extra third-party coverage is even more valuable.
What you pay for extra third-party coverage will be determined by how much extra coverage you want.
Uninsured motorist coverage
As another standard and underfunded part of basic car insurance in Toronto, a bump to this will be much appreciated if you’re seriously injured in an accident with an uninsured or under-insured motorist. If you require medical care or time off work the other driver’s insurance can’t or won’t cover, this can be a lifesaver. The cost of this coverage will also depend on how much more you want.